** **

**UNITEDSTATES**

**SECURITIESAND EXCHANGE COMMISSION**

**WASHINGTON,DC 20549**

** **

**FORM 10-Q**

** **

**Quarterly Report Under Section 13 or 15(d)**

**of the Securities Exchange Act of 1934**

** **

** **

| **For the  quarterly period ended September 30, 2007** | ** ** | **Commission  file number 0-15070** |
|--------------------------------------------------------|------------|-------------------------------------|

** **

** **

** **

**REGENERX BIOPHARMACEUTICALS, INC.**

(Exact name ofregistrant as specified in its charter)

 

 

| **Delaware**              | ** ** | **52-1253406**              |
|---------------------------|------------|-----------------------------|
| (State of  Incorporation) |       | (IRS Employer  I.D. Number) |

 

 

| **3  Bethesda Metro Center**              |
|-------------------------------------------|
| **Suite  630**                            |
| **Bethesda,  Maryland 20814**             |
| (Address of  principal executive offices) |

 

 

 

Issuer’s telephonenumber, including area code: **(301) 280-1992**

 

 

Indicate by checkmark whether the registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file suchreports), and (2) has been subject to such filing requirements for the past 90days.

                                                                                                                                                     Yesx             Noo

 

 

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer,or a non-accelerated filer.  Seedefinition of “accelerated filer and large accelerated filer” in Rule 12b-2 ofthe Exchange Act.  (Check one):

 

| Large  accelerated filer o |   | Accelerated  filer o |   | Non-accelerated  filer x |
|----------------------------|--------|----------------------|--------|--------------------------|

 

 

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2 of theExchange Act).  

 

                                                                                                                                                     Yeso             Nox

 

 

46,553,527****shares of RegeneRx Biopharmaceuticals,Inc. Common Stock, par value $.001 per share, were outstanding as of September30, 2007.

 

 

 

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**RegeneRxBiopharmaceuticals, Inc.**

**Form 10-Q**

**QuarterlyPeriod Ended September 30, 2007**

 

### **INDEX**

 
| Part I.    | FINANCIAL INFORMATION |                                                                                                   | **Page No.** |
|------------|-----------------------|--------------------------------------------------------------------------------------------------------|--------------|
|       |                  |                                                                                                   |         |   |
|       | Item  1.              | Financial Statements.                                                                                  |         |   |
|       |                  |                                                                                                   |         |   |
|       |                  | Balance Sheets at September 30, 2007 (unaudited) and December 31, 2006                                 |         | 3 |
|       |                  |                                                                                                   |         |   |
|       |                  | Statements of  Operations for the three and nine months ended September 30, 2007 and  2006 (unaudited) |         | 4 |
|       |                  |                                                                                                   |         |   |
|       |                  | Statements of  Cash Flows for the nine months ended September  30, 2007 and 2006  (unaudited)          |         | 5 |
|       |                  |                                                                                                   |         |   |
|       |                  | Notes to Financial  Statements (unaudited)                                                             |         | 6-10 |
|       |                  |                                                                                                   |         |   |
|       | Item 2.               | Management’s  Discussion and Analysis of Financial Condition and Results of Operations.           |         | 11 |
|       |                  |                                                                                                   |         |   |
|       | Item 3.               | Quantitative  and Qualitative Disclosures About Market Risk.                                           |         | 16 |
|       |                  |                                                                                                   |         |   |
|       | Item 4.               | Controls and Procedures.                                                                               |         | 16 |
|       |                  |                                                                                                   |         |   |
| Part  II.  | OTHER INFORMATION     |                                                                                                   |         |
|       |                  |                                                                                                   |         |   |
|       | Item 1.               | Legal Proceedings.                                                                                     |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 1A.              | Risk Factors.                                                                                          |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 2.               | Unregistered  Sales of Equity Securities and Use of Proceeds.                                          |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 3.               | Defaults Upon  Senior Securities.                                                                      |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 4.               | Submission of  Matters to a Vote of Security Holders.                                                  |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 5.               | Other Information.                                                                                     |         | 17 |
|       |                  |                                                                                                   |         |   |
|       | Item 6.               | Exhibits.                                                                                              |         | 18-19 |
|       |                  |                                                                                                   |         |   |
| Signatures |                  |                                                                                                   | 21           |

 

2

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**PART I —FINANCIAL INFORMATION**

** **

**Item 1.         Financial Statements**

** **

**RegeneRx Biopharmaceuticals, Inc.**

**Balance Sheets**

 
| ** **                                                                                                                | ** ** | **September 30,** | ** ** | **December 31,** | ** ** |
|---------------------------------------------------------------------------------------------------------------------------|------------|-------------------|------------|------------------|------------|
| ** **                                                                                                                | ** ** | **2007**          | ** ** | **2006**         | ** ** |
| ** **                                                                                                                | ** ** | ** **        | ** ** | ** **       | ** ** |
| ASSETS                                                                                                                    |       |              |       |             |       |
| Current assets                                                                                                            |       |              |       |             |       |
| Cash and cash equivalents                                                                                                 |       | $                 | 1,841,633  |             | $          | 13,052,308 |   |
| Short-term investments                                                                                                    |       | 8,160,692         |       | 4,000,000        |       |
| Accounts receivable                                                                                                       |       | 213,373           |       | 272,491          |       |
| Prepaid expenses and other current assets                                                                                 |       | 333,578           |       | 111,679          |       |
| Total current assets                                                                                                      |       | 10,549,276        |       | 17,436,478       |       |
| Fixed assets, net of accumulated depreciation of $56,724 and $41,030                                                      |       | 48,136            |       | 53,398           |       |
| Other non-current assets                                                                                                  |       | 5,693             |       | 11,749           |       |
| Total assets                                                                                                              |       | $                 | 10,603,105 |             | $          | 17,501,625 |   |
|                                                                                                                      |       |              |       |             |       |
| LIABILITIES AND STOCKHOLDERS'  EQUITY                                                                                     |       |              |       |             |       |
| Current liabilities                                                                                                       |       |              |       |             |       |
| Accounts payable                                                                                                          |       | $                 | 331,844    |             | $          | 362,402 |   |
| Accrued expenses                                                                                                          |       | 840,684           |       | 886,888          |       |
| Total current liabilities                                                                                                 |       | 1,172,528         |       | 1,249,290        |       |
| Commitments                                                                                                               |       | —            |       | —           |       |
|                                                                                                                      |       |              |       |             |       |
| Stockholders' equity                                                                                                      |       |              |       |             |       |
| Preferred stock, $.001 par value per share, 1,000,000 authorized; no  shares issued                                       |       | —            |       | —           |       |
| Common stock, par value $.001 per share, 100,000,000 shares authorized;  46,553,527 and 46,096,477 issued and outstanding |       | 46,554            |       | 46,096           |       |
| Additional paid-in capital                                                                                                |       | 73,250,428        |       | 72,433,660       |       |
| Accumulated other comprehensive loss                                                                                      |       | (1,844            | )          | —           |       |
| Accumulated deficit                                                                                                       |       | (63,864,561       | )          | (56,227,421      | )          |
| Total stockholders' equity                                                                                                |       | 9,430,577         |       | 16,252,335       |       |
| Total liabilities and stockholders' equity                                                                                |       | $                 | 10,603,105 |             | $          | 17,501,625 |   |

 

The accompanying notesare an integral part of these financial statements.

 

 

 

3

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**RegeneRxBiopharmaceuticals, Inc.**

**Statements of Operations**

 
| ** **                                            | ** ** | **Three Months ended** | ** ** | **Nine Months ended** | ** ** |
|-------------------------------------------------------|------------|------------------------|------------|-----------------------|------------|
| ** **                                            | ** ** | **September 30,**      | ** ** | **September 30,**     | ** ** |
| ** **                                            | ** ** | **2007**               | ** ** | **2006**              | ** ** | **2007** | ** ** | **2006** | ** ** |
| Revenues                                              |       | $                      | 213,373    |                  | $          | — |   | $ | 213,373 |   | $ | — |   |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Operating  expenses:                                  |       |                   |       |                  |       |   |   |   |   |
| Research and  development                             |       | 1,761,759              |       | 1,442,457             |       | 6,120,007 |   | 5,186,803 |   |
| General and  administrative                           |       | 684,617                |       | 633,724               |       | 2,269,745 |   | 1,902,824 |   |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Total operating  expenses                             |       | 2,446,376              |       | 2,076,181             |       | 8,389,752 |   | 7,089,627 |   |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Loss from  operations                                 |       | (2,233,003             | )          | (2,076,181            | )          | (8,176,379 | ) | (7,089,627 | ) |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Interest income                                       |       | 151,301                |       | 140,608               |       | 539,239 |   | 391,994 |   |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Net loss                                              |       | $                      | (2,081,702 | )                     | $          | (1,935,573 | ) | $ | (7,637,140 | ) | $ | (6,697,633 | ) |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Basic and  diluted net loss per common share          |       | $                      | (0.04      | )                     | $          | (0.05 | ) | $ | (0.16 | ) | $ | (0.17 | ) |
|                                                  |       |                   |       |                  |       |   |   |   |   |
| Weighted average  number of common shares outstanding |       | 46,553,527             |       | 40,39,300             |       | 46,436,479 |   | 39,688,129 |   |
|                                                       |            |                        |            |                       |            |  |  |  |  |  |  |  |  |  |

 

The accompanying notesare an integral part of these financial statements.

 

 

4

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**RegeneRx Biopharmaceuticals, Inc.**

**Statements of Cash Flows**

 
| ** **                                                                   | ** ** | **Nine months ended** | ** ** |
|------------------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                                   | ** ** | **September 30,**     | ** ** |
| ** **                                                                   | ** ** | **2007**              | ** ** | **2006** | ** ** |
|                                                                         |       |                  |       |   |   |
| Operating activities:                                                        |       |                  |       |   |   |
| Net loss                                                                     |       | $                     | (7,637,140 | ) | $ | (6,697,633 | ) |
| Adjustments to reconcile net loss to net cash used in operating  activities: |       |                  |       |   |   |
| Depreciation and amortization                                                |       | 15,695                |       | 13,381 |   |
| Non-cash share-based compensation                                            |       | 771,520               |       | 591,470 |   |
| Changes in operating assets and liabilities:                                 |       |                  |       |   |   |
| Accounts receivable                                                          |       | 59,118                |       | — |   |
| Prepaid expenses and other current assets                                    |       | (221,899              | )          | (78,218 | ) |
| Due from related party                                                       |       | —                |       | 4,592 |   |
| Other non-current assets                                                     |       | 6,056                 |       | 5,329 |   |
| Accounts payable                                                             |       | (30,558               | )          | (125,860 | ) |
| Accrued expenses                                                             |       | (46,204               | )          | 561,157 |   |
| Net cash used in operating activities                                        |       | (7,083,412            | )          | (5,725,782 | ) |
|                                                                         |       |                  |       |   |   |
| Investing activities:                                                        |       |                  |       |   |   |
| Purchase of short-term, available-for-sale investments                       |       | (17,562,536           | )          | (5,580,424 | ) |
| Proceeds from sales/maturities of short-term investments                     |       | 13,400,000            |       | 4,254,781 |   |
| Purchase of fixed assets                                                     |       | (10,433               | )          | (17,276 | ) |
| Net cash used in investing activities                                        |       | (4,172,969            | )          | (1,342,919 | ) |
|                                                                         |       |                  |       |   |   |
| Financing activities:                                                        |       |                  |       |   |   |
| Net proceeds from issuance of common stock                                   |       | —                |       | 7,283,398 |   |
| Preceeds from exercise of warrants                                           |       | 45,706                |       | 774,250 |   |
| Offering Costs                                                               |       | —                |       | (462,239 | ) |
| Net cash provided by financing activities                                    |       | 45,706                |       | 7,595,409 |   |
| Net increase in cash and cash equivalents                                    |       | (11,210,675           | )          | 526,708 |   |
| Cash and cash equivalents:                                                   |       |                  |       |   |   |
| Beginning of period                                                          |       | 13,052,308            |       | 4,896,143 |   |
| End of Period                                                                |       | $                     | 1,841,633  |   | $ | 5,422,851 |   |

 

The accompanyingnotes are an integral part of these financial statements.

 

 

5

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**RegeneRxBiopharmaceuticals, Inc.**

**Notes to Financial Statements**

**For thenine months ended September 30, 2007 and 2006 (Unaudited)**

 

A.      ORGANIZATION & BASIS OF PRESENTATION

 

RegeneRx Biopharmaceuticals, Inc. (the “Company”, “We”, “Us”, “Our” or “RegeneRx”),is a biopharmaceutical company focused on the discovery and development ofnovel molecules to accelerate tissue and organ repair.  Currently, we are developing Thymosin beta 4(“Tß4”), a 43 amino acid peptide as the basis for our technologyplatform.  Current research suggests that Tß4 may prove efficacious formultiple medical indications; therefore, we are developing several Tß4-basedtherapeutic drug candidates.  We hold over sixty world-wide patents andpatent applications related to dermal, ophthalmic, and internal wounds andtissue repair, cardiac and neurological injuries, and septic shock.  We are currently sponsoring, inparallel, three Phase II dermal wound healing clinical trials and a Phase IIophthalmic wound healing trial.  Underour Phase II Investigational New Drug Application (“IND”), Sigma-Tau, one ofour major shareholders, is conducting one of the Phase II dermal wound healingclinical trials in the European Union and has assumed all associatedcosts.  Additionally, we have beencleared by the U.S. Food and Drug Administration (“FDA”) to initiate a Phase IAtrial utilizing a parenteral (intravenous or i.v.) route of administration aspart of our cardiovascular clinical program.

 

Theaccompanying unaudited financial statements reflect, in the opinion ofmanagement, all adjustments (consisting of normal recurring adjustments)necessary for a fair presentation of our financial position, results ofoperations and cash flows for each period presented.  These statements have been prepared in accordancewith generally accepted accounting principles in the United States for interimfinancial information and with the instructions to Form 10-Q and Article 10 ofRegulation S-X.  Accordingly, they do notinclude all of the information and footnotes required by generally acceptedaccounting principles for complete financial statements. These interimfinancial statements should be read in conjunction with the audited financialstatements and related notes thereto, which are included in our Annual Report onForm 10-K for the year ended December 31, 2006. Similarly, this entire report should be read in conjunction with ourAnnual Report on Form 10-K for a broader understanding of our business andinherent risks.

 

Theaccompanying December 31, 2006 financial information was derived from auditedfinancial statements.  Operating resultsfor the three and nine-month periods ended September 30, 2007 are notnecessarily indicative of the results to be expected for the year endingDecember 31, 2007 or any other future period.

 

B.      REVENUES

 

We accrue revenues under a grant receivedfrom the FDA’s Office of Orphan Drugs as qualifying costs are incurred.  To date we have received one grant for ourepidermolysis bullosa trial.  That grantwas awarded in two annual amounts of approximately $272,500, or $545,000 intotal.  This grant was awarded in August2006 under a grant year ending in June of each calendar year.  Consequently, and based on the qualifyingcosts incurred, the entire first year award was recognized in the fourthquarter of 2006.  Also based on thequalifying costs incurred during the second grant year starting in June 2007,approximately $213,000 of revenue has been recognized in the three months endedSeptember 30, 2007.

 

 

 

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C.      NET LOSS PER SHARE

 

Netloss per share is based on the weighted average number of common sharesoutstanding during the three and nine months periods ended September 30, 2007and September 30, 2006.  During theseperiods, certain securities were not included in the calculation as theireffect would be anti-dilutive. Securities that could potentially dilute basic net loss per share in thefuture, and that were not included in the calculation of diluted net loss pershare, are as follows:

 
| ** **                                                                          | ** ** | **September 30,** | ** ** |
|-------------------------------------------------------------------------------------|------------|-------------------|------------|
| ** **                                                                          | ** ** | **2007**          | ** ** | **2006** | ** ** |
|                                                                                |       |              |       |   |   |
| Outstanding stock options                                                           |       | 3,545,000         |       | 2,655,000 |   |
| Warrants                                                                            |       | 3,522,544         |       | 1,879,812 |   |
| Total potential common shares excluded from diluted net loss per share  computation |       | 7,067,544         |       | 4,534,812 |   |

 

D.      STOCK BASEDCOMPENSATION

 

On January 1, 2006 weadopted Statement of Financial Accounting Standards No. 123 (revised 2004), “Share-BasedPayment” (or “FAS 123R”), which supersedes our previous accounting under APBOpinion No.  25, “Accounting for StockIssued to Employees” (or “APB 25”).  FAS123R requires the recognition of compensation expense, using a fair-value basedmethod, for cost related to all share-based payments including stockoptions.  FAS 123R requires companies toestimate the fair value of share-based payment awards on the date of grantusing an option-pricing model.  The valueof the portion of the award that is ultimately expected to vest is recognizedas expense on a straight-line basis over the requisite service periods in ourStatements of Operations.  We adopted FAS123R using the modified prospective transition method, which requires thatcompensation expense be recognized in the financial statements for all awardsgranted after the date of adoption as well as for existing awards for which therequisite service has not been rendered as of the date of adoption.  The modified prospective transition methoddoes not require restatement of prior periods to reflect the impact of FAS123R.

 

A summary of compensationexpense related to stock options follows:

 
| ** **                 | ** ** | **Three months ended** | ** ** | **Nine months ended** | ** ** |
|----------------------------|------------|------------------------|------------|-----------------------|------------|
| ** **                 | ** ** | **September 30,**      | ** ** | **September 30,**     | ** ** |
| ** **                 | ** ** | **2007**               | ** ** | **2006**              | ** ** | **2007** | ** ** | **2006** | ** ** |
| Employees                  |       | $                      | 162,871    |                  | $          | 114,329 |   | $ | 486,356 |   | $ | 339,190 |   |
| Non-employees              |       | 94,239                 |       | 87,621                |       | 285,164 |   | 252,280 |   |
| Total compensation expense |       | $                      | 257,110    |                  | $          | 201,950 |   | $ | 771,520 |   | $ | 591,470 |   |
|                       |       |                   |       |                  |       |   |   |   |   |
| Research and development   |       | $                      | 105,534    |                  | $          | 73,878 |   | $ | 317,187 |   | $ | 217,837 |   |
| General and administrative |       | 151,576                |       | 128,072               |       | 454,333 |   | 373,633 |   |
| Total compensation expense |       | $                      | 257,110    |                  | $          | 201,950 |   | $ | 771,520 |   | $ | 591,470 |   |

 

 

 

 

7

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At September 30, 2007 totalcompensation cost related to non-vested stock options not yet recognized wasapproximately $2,298,231, which is expected to be recognized over the next 1.4years, on a weighted average basis.

 

*Valuation assumptions*

 

The fair value for each option granted wasestimated at the date of grant using the Black-Scholes option-pricing model,assuming no expected dividends.  The riskfree rate of return was established for each award, based on the date of grantand the expected life of the award. Since our historical data is limited, the expected life was determinedin accordance with SAB 107 guidance for “plain vanilla” options.  The volatility was determined, based on thehistorical closing price of the Company’s publicly-traded stock, as measuredfor a time period consistent with the expected life of the option.  Approximate values of these assumptionsfollow:

 
| ** **                | ** ** | **2007**  | ** ** | **2006**  | ** ** |
|---------------------------|------------|-----------|------------|-----------|------------|
|                      |       |      |       |      |       |
| Dividend yield            |       | 0.0       | %          | 0.0       | %          |
| Risk free rate  of return |       | 3.9 - 5.1 | %          | 4.3 - 5.0 | %          |
| Expected life in  years   |       | 3.0 - 5.0 |       | 6.0 - 6.5 |       |
| Volatility                |       | 68 - 75   | %          | 100 - 333 | %          |

 

*Stock Option Activity*

 

The following is a summaryof option activity for the nine months ended September 30, 2007:

 
| ** **          | ** ** | ** **                         | ** ** | **Options outstanding**    | ** ** |
|---------------------|------------|------------------------------------|------------|----------------------------|------------|
| ** **          | ** ** | **Shares   available for   grant** | ** ** | **Number of  shares** | ** ** | **Weighted   average   exercise  price** | ** ** |
| December 31,  2006  |       | 1,480,000                          |       | 2,685,000                  |       | $ | 1.66 |   |
| Grants              |       | (860,000                           | )          | 860,000                    |       | 2.24 |   |
| Exercises           |       | —                             |       | —                     |       | — |   |
| Cancellations       |       | —                             |       | —                     |       | — |   |
| September 30,  2007 |       | 620,000                            |       | 3,545,000                  |       | $ | 1.80 |   |
|                     |            |                                    |            |                            |            |  |  |  |  |

 

 

Based on the assumptions inthe Black-Scholes valuation model discussed above, the estimated fair value ofshares vested during the first three quarters of 2007 and 2006 was $668,822 and$505,283, respectively.  During the firstthree quarters of 2007 and 2006 the aggregate estimated fair value of stockoptions granted and their weighted average per share values were $907,809($1.37 per share) and $407,267 ($2.54 per share), respectively. 

 

 

 

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The following tablesummarizes outstanding and exercisable options at September 30, 2007:

 
| ** **                                                                                    | ** **   | **Outstanding options**          | ** ** | **Exerciseable options**                                   | ** ** |
|-----------------------------------------------------------------------------------------------|--------------|----------------------------------|------------|------------------------------------------------------------|------------|
| **Range of exercise prices**                                                                  | ** **   | **Number of shares outstanding** | ** ** | **Weighted-average remaining contractual life (in years)** | ** ** | **Weighted-average exercise price** | ** ** | **Number of shares outstanding** | ** ** | **Weighted-average remaining contractual life (in years)** | ** ** | **Weighted-average exercise price** | ** ** |
|                                                                                          |         |                             |       |                                                       |       |   |   |   |   |   |   |   |   |
| $                                                                                             | 0.28 - $0.86 |                             | 1,290,000  |                                                       | 4.4        |   | $ | 0.38 |   | 1,221,250 |   | 4.3 |   | $ | 0.36 |   |
| $                                                                                             | 1.07 - $1.93 |                             | 280,000    |                                                       | 6.5        |   | $ | 1.50 |   | 255,000 |   | 6.6 |   | $ | 1.46 |   |
| $                                                                                             | 2.02 - $2.68 |                             | 900,000    |                                                       | 6.6        |   | $ | 2.27 |   | 4,250 |   | 8.6 |   | $ | 2.62 |   |
| $                                                                                             | 3.00 - $3.82 |                             | 1,075,000  |                                                       | 7.6        |   | $ | 3.19 |   | 434,583 |   | 7.6 |   | $ | 3.19 |   |
|                                                                                          |         | 3,545,000                        |       |                                                       |       |   |   | 1,915,083 |   |   |   |   |   |
|                                                                                          |         |                             |       |                                                       |       |   |   |   |   |   |   |   |   |
| Intrinsic value  of in-the-money options, using the September 30, 2007 closing price of $1.69 |         | $                                | 1,746,000  |                                                       |       |   |   |   | $ |  1,688,938 |   |   |   |   |   |
|                                                                                               |              |                                  |            |                                                            |            |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

 

E.       OTHERCOMPREHENSIVE INCOME

 

Our other comprehensive income or loss is comprisedsolely of unrealized gains and losses on our portfolioof available-for-sale, marketable securities.  Annually, we presentother comprehensive income or loss in our Statement of Stockholders Equityand in a footnote during interim periods.  For the nine month period endedSeptember 30, 2007, we recognized an unrealized loss of ($1,844), which increasedour accumulated other comprehensive loss from $0 at December 31, 2006 to($1,844) at September 30, 2007.  We recognized other comprehensive incomeof $3,044 in the corresponding interim period in 2006.

 

F.       EQUITYTRANSACTIONS

 

*Exerciseof Warrants*

 

During the nine months ended September 30,2007, we received $45,706 for the exercise of warrants associated with 457,050shares of our common stock.

 

 

G.      EFFECTOF NEW ACCOUNTING STANDARDS

 

InSeptember 2006, the Financial Accounting Standards Board (FASB) issuedInterpretation No. 48, “Accounting for Uncertainty in Income Taxes, aninterpretation of FASB Statement 109” (“FIN 48”). This statement clarifies thecriteria that an individual tax position must satisfy for some or all of thebenefits of that position to be recognized in a company’s financial statements.FIN 48 prescribes a recognition threshold of more-likely-than-not, and ameasurement attribute for all tax positions taken or expected to be taken on atax return, in order for those tax positions to be recognized in the financialstatements. Effective January 1, 2007, we adopted the provisions of FIN48, and determined that the impact had no material effect on our financialstatements.

 

InSeptember 2006, and February 2007 the FASB issued FASB Statement of FinancialAccounting Standards No. 157, “Fair Value Measurements” (“FAS 157”), andStatement of Financial Accounting Standards No. 159, “The Fair Value Option forFinancial Assets and Financial Liabilities” (“FAS 159”), respectively.  Both standards prescribe changes to fairvalue measurements of certain assets and 

 

 

 

9

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liabilitiesand are effective for fiscal years beginning after November 15, 2007. We do notanticipate the adoption of these standards will have a material impact on ourfinancial statements.

 

In September 2007, the Emerging Issues TaskForce (“EITF”) reached a consensus on EITF Issue No. 07-03, “Accounting forNonrefundable Advance Payments for Goods or Services to Be Used in FutureResearch and Development Activities.” EITF 07-03 concludes that non-refundableadvance payments for future research and development activities should bedeferred and capitalized until the goods have been delivered or the relatedservices have been performed. If and when an entity no longer expects toreceive the goods or services contracted, any remaining capitalized,nonrefundable, advance payments should then be charged to expense. Thisconsensus is effective for fiscal years beginning after December 15, 2007.Currently we expense nonrefundable advance payments when paid.    If on the date of adoption, January 1,2008, we determine that there are qualifying transactions requiringcapitalization in accordance with EITF 07-03, we will adopt the provisions ofthis statement through a cumulative-effect adjustment to retained earnings onthat date.

 

 

 

10

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**ITEM 2.          Management’sDiscussion and Analysis of Financial Condition and Results of Operations**

 

 

*This report containsforward-looking statements concerning matters that involve risks anduncertainties.  Statements made in thisItem that are not purely historical, including statements about us, ourrespective clinical trials, research programs, product pipelines, current andpotential corporate partnerships, licenses and intellectual property, theadequacy of capital reserves and anticipated operating results and cashexpenditures, are forward-looking statements within the meaning of Section 21Eof the Securities Exchange Act of 1934, as amended and Section 27A of theSecurities Act of 1933, as amended (the “Securities Act”).  Words such as “anticipate,” “believes,” “expect,”“likely,” “may,” “plans” and “targeted” are intended to identifyforward—looking statements, although not all forward-looking statements containthese words. These forward-looking statements concern matters that involverisks and uncertainties that could cause actual results to differ materiallyfrom those projected, including risks associated with the success of researchand product development programs, the issuance and validity of patents, thedevelopment and protection of proprietary technologies, the ability to raisecapital, operating expense levels and the ability to establish and retaincorporate partnerships, our history of operating losses and the risks set forthunder Item 1A., Risk Factors, in our Annual Report on Form 10-K for the yearended December 31, 2006, which risk factors are incorporated herein byreference.  We do not undertake anyobligation to update forward-looking statements.  The following should be read in conjunctionwith our financial statements included in Item 1, and the financial statementsin our Annual Report on Form 10-K for the year ended December 31, 2006 and inother documents filed by us from time to time with the Securities and ExchangeCommission.*

 

**Overview**

 

RegeneRx Biopharmaceuticals, Inc. (the “Company”, “We”, “Us”, “Our” or “RegeneRx”),is a biopharmaceutical company focused on the discovery and development ofnovel molecules to accelerate tissue and organ repair.  Currently, we are developing Thymosin beta 4(“Tß4”), a 43 amino acid peptide as the basis for our technologyplatform.  Current research suggests that Tß4 may prove efficacious formultiple medical indications; therefore, we are developing several Tß4-basedtherapeutic drug candidates.  We hold over sixty world-wide patents andpatent applications related to dermal, ophthalmic, and internal wounds andtissue repair, cardiac and neurological injuries, and septic shock.  We are currently sponsoring, inparallel, three Phase II dermal wound healing clinical trials and a Phase IIophthalmic wound healing trial.  Underour Phase II Investigational New Drug Application (“IND”), Sigma-Tau, one ofour major shareholders, is conducting one of our Phase II dermal wound healingclinical trials in the European Union and has assumed all associated costs.  Additionally, we have recently been clearedby the FDA to initiate a Phase IA trial utilizing a parenteral (intravenous ori.v.) route of administration as part of our cardiovascular clinical program.

 

The following are our targeted enrollment timelines for our variousclinical trials:

•                              Phase IIpressure ulcer trial: enrollment completion target — fourth quarter 2007 orfirst quarter 2008.

•                              Phase II venousstasis ulcer trial:  enrollmentcompletion target — first quarter 2008.

•                              Phase IIEpidermolysis Bullosa (“EB”) trial: enrollment completion target — first half 2009.

•                              Phase IIophthalmic diabetic vitrectomy trial: enrollment completion by second quarter 2008.

•                              Phase IAintravenous trial (in preparation for cardiovascular trials):  initiate fourth quarter 2007, enrollment 

 

 

11

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and treatment completion (includingPhase IB), fourth quarter 2008.

 

In the pressure ulcer and venous stasis ulcertrials, patients are treated up to 84 days, or shorter if their ulcers heal;and up to 56 days in the EB trial, or shorter if their lesions heal.  In the ophthalmic trial, patients are treatedup to 14 days; and in the Phase IA trial healthy volunteers are given an i.v.dose and evaluated for 24 hours.  In allfive trials statistical analyses and final reports follow shortly thereafter.

 

We have incurred significant losses since ourinception.  As of September 30, 2007, ouraccumulated deficit was $63.9 million. We have incurred net losses due to expenditures for research anddevelopment, clinical trials, contract manufacturing, and general andadministrative services in support of our operations.  We anticipate incurring net losses over atleast the next several years as we continue our clinical trials, apply for regulatoryapprovals, develop our technology, and expand our operations to support thecommercialization or out-licensing of our drug candidates.

 

We also anticipate incurring additionallosses for several years as we expand our drug discovery and developmentprograms.  We expect that losses will fluctuatefrom quarter to quarter and that such fluctuations may be substantial.  We do not expect to generate revenues fromour drug discovery and development efforts for several years, if at all.  If we are unable to successfully develop andmarket pharmaceutical products over the next several years, our business,financial condition and results of operations would be adversely impacted.

 

In July 2005, we were granted the first European patent related to Tß4wound healing technology, which we have licensed from the National Institutesof Health in Bethesda, Maryland. The original patent application, filed in1999, claims numerous compositions, uses and processes related to Tß4. Thegrant of the European Patent is being opposed by a third party in a proceedingat the European Patent Office, and we cannot guarantee that any or all of thegranted claims will prevail. Similar patent applications have been submitted byus in other territories throughout the world, including the U.S. and Asia. Wehave independently filed over sixty world-wide patent applications related toour technology platform. In September of this quarter, we received a U.S.Patent based on the original NIH filing related to dermal wound healing

 

We utilize anout-sourcing business strategy that we believe is cost effective and allows usthe flexibility to implement or modify projects as needed.  This strategy employs contract research anddevelopment organizations (“CROs”), which have established workforces andfacilities to manufacture and formulate our products, as well as conductclinical trials and perform other product development activities.  It also allows us to spend significantly lesscapital for infrastructure and other fixed costs.  We will, therefore, continue to operate ourout-sourcing strategy in the near term.

 

**Critical Accounting Policies**

 

Share-based payment — Effective January 1, 2006, we adopted the fairvalue recognition provisions of FASB Statement No. 123R, using the modifiedprospective transition method, and therefore have not restated results forprior periods. Under this method we recognize compensation expense for allshare-based payments granted to employees after January 1, 2006 and prior tobut not yet vested as of January 1, 2006, in accordance with Statement No. 123R.Under the fair value recognition provisions of Statement No. 123R, we recognizestock-based compensation net of an estimated forfeiture rate and only recognizecompensation cost for those shares expected to vest on a straight-line basisover the requisite service period of the award.

 

 

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Determining the appropriate fair value model and calculating the fairvalue of share-based payment awards require the input of highly subjectiveassumptions, including the expected life of the share-based payment awards andstock price volatility. Since our historical data is limited, the expected lifewas determined in accordance with SAB 107 guidance for “plain vanilla” options.Since our historical trading volume is relatively low, we estimated theexpected volatility based on monthly closing prices for a period consistentwith the expected life of the option. The assumptions used in calculating thefair value of share-based payment awards represent management’s best estimates,but these estimates involve inherent uncertainties and the application ofmanagement judgment. As a result, if factors change and we use differentassumptions, our stock-based compensation expense could be materially differentin the future. In addition, we are required to estimate the expected forfeiturerate and only recognize expense for those shares expected to vest. If ouractual forfeiture rate is materially different from our estimate, thestock-based compensation expense could be significantly different from what wehave recorded in the current period. See Note C to the Financial Statements fora further discussion on stock-based compensation.

 

Clinical trial costs — We accrueestimated costs for clinical studies conducted by contract researchorganizations and participating clinical sites. These costs are a significant component of research and developmentexpenses.  We accrue/defer costs forclinical studies performed by contract research organizations based onestimates of work performed under the contracts.  Costs of initiating clinical sites forparticipation in our trials are accrued as the sites are initiated.  Hospital costs related to patient enrollmentare accrued as patients enter and progress through the trial.  Refundable, contractual deposits for clinicaldevelopment services are deferred and recognized when the contracted servicesare performed.

 

**Results of operations for thethree and nine months ended September 30, 2007 and 2006**

 

*Research and development expenses*

 

For the nine months ended September 30, 2007compared to the corresponding period in 2006, research and development (“R&D”)expenses increased approximately $0.93 million or 18% to $6.12 million.  For the three months ended September 30, 2007R&D expenses increased approximately $0.32 million or 22%.  This increase is due primarily to increasedpersonnel costs and costs associated with our expanding clinical researchprograms.   During the first quarter of2007 we hired two additional employees who are wholly dedicated to clinicalresearch bringing our clinical development employees to a total of eight.  The associated increase in base salaries andincentives,  annual merit increases forour other clinical employees, along with additional stock option grants hasincreased our personnel costs by approximately $0.47 million (7.6% of totalR&D expenses) and $0.137 million (7.4% of total R&D expenses) for thenine and three-month period ended September 30, 2007 compared to the sameperiods in 2006, respectively.  For thenine and three-month periods ended September 30, 2007, compared to the sameperiods in 2006 our costs for our expanding clinical research have increased byapproximately $0.42 million (7% of total R&D expenses) and $0.20 million(12% of total R&D expenses), respectively. In May of 2007, the FDA cleared us to open a Phase II ophthalmic trialand a Phase IA myocardial trial.  Thepreparation for and the opening of these trials, along with an increased rateof patient enrollment, and the increased number of operable clinical sites forour two US-based Phase II dermal studies are the reasons we have experiencedadditional costs for our expanding clinical research program as compared toprior periods.  Research and developmentis comprised of all internal and external costs to support our clinicalprograms, including:  drug manufacture,formulation, and stability; fees to clinical trial sites; and, other outsideservices such as clinical program management.

 

* *

 

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*General and administrativeexpenses*

 

For the nine months ended September 30, 2007compared to the corresponding period in 2006, general and administrativeexpenses (“G&A”) increased by approximately $0.36 million  or 19% to $6.27 million.  For the three months ended September 30, 2007G&A expenses increased approximately $0.05 million or 8%.    The majority of the net nine-month increase($0.28 million of $0.36 million) and all of the net three-month increase inG&A costs is attributable to an increased use of outside professionals,including outside counsel to advise management on general corporate matters,and outside accountants to address our financial reporting requirements,including compliance with the Sarbanes Oxley Act of 2002.    General and Administrative expenses arecomprised of the direct and indirect expenses of our Board and executive managementteam, office facilities, attorneys, outsourced service providers such asaccountants, attorneys, investor relations, information systems support, andour registered independent public accounting firm.

 

*Interest income*

 

Interest income was $0.15 million and $0.54million for the three and nine-month periods ended September 30, 2007respectively, compared to $0.14 million and $0.39 million for the respectivecorresponding periods in 2006.  Theseincreases in interest income are due to an increase in the average amountinvested in each period and a year-over-year improvement in average investmentreturns due primarily to rising interest rates.

 

**Liquidity and capital resources**

 

*Sources of liquidity*

 

Since inception we have financed ouroperations through the sale of equity securities.  At September 30, 2007, we had $10.0 million in cash, cash equivalents andshort-term investments.

 

Cash used in operating activities for thenine months ended September 30, 2007 was $7.08 million, as compared with $5.73million in 2006, an increase of $1.35 million. This increased use of cash is greater than the corresponding increase inthe net operating loss reported due to differences in accrued liabilities andother balance sheet items between periods.

 

Cash used in investing activities for thenine months ended September 30, 2007 was $4.17 million, compared with $1.34million in 2006.  This increased use ofcash represents an increase in the total amount invested in qualifying short-terminvestments during the period.

 

Cash provided by financing activities for thenine months ended September 30, 2007 was $0.05 million, compared to $7.60million provided in the first nine months of 2006.  In 2006 we sold approximately 2.6 million sharesof common stock.  In the first ninemonths of 2007 we only received cash from financing activities through theexercise of warrants as described in Note F to the Financial Statements.

 

Although no assurance can be given, webelieve that our current cash and investment balances will be sufficient tomeet our operating needs for the activities we currently have underway into thesecond quarter of 2008.  However, thoseactivities will not be sufficient to bring our drug candidates to market and wetherefore believe new capital resources will be required, in the coming months,to continue our 

 

 

 

 

 

14

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independent development efforts.  Accordingly,we may entertain the possibility of raising additional capital to preserve ourliquidity, including, without limitation, the issuance of new equity,incurrence of additional debt, and/or the sale or licensing of ourtechnology.  We regularly consider theconditions of capital markets, dilution, stockholder value and tax consequencesof each type of financing on stockholders. Certain of the financing options available to us may have negativeconsequences to stockholders such as dilution, interest expense or the loss offuture revenue opportunities.

 

*Contractual obligations*

 

Our contractual obligations as of September30, 2007 consist of an office facility lease and obligations to purchase Tß4, as follows:

 
| ** **            | ** ** | **Payments due by period:** | ** ** |
|-----------------------|------------|-----------------------------|------------|
| ** **            | ** ** | **Total**                   | ** ** | **Under 1 year** | ** ** | **1 - 3 years** | ** ** |
| Operating lease       |       | $                           | 18,117     |   | $ | 18,117 |   |   |   |
| Purchase  obligations |       | 989,819                     |       | 989,819 |   |   |   |
|                  |       | $                           | 1,007,936  |   | $ | 1,007,936 |   | $ | — |   |
|                       |            |                             |            |  |  |  |  |  |  |  |  |

 

We also have $4.71 million in othercontractual obligations due within one year and related to our research anddevelopment efforts.  These obligations,however, are contingent on future events, including the rate of patient accrualin our clinical trials.  This amountrepresents the remaining contractual amounts due under various contracts,although all of these contracts could be cancelled by us, in which case wewould only be liable to the vendors for work performed to the date ofcancellation.

 

*Off Balance Sheet Arrangements*

 

We have no off-balance sheet arrangements, as such arrangements aredefined by Item 303(a)(4) of Regulation S-K, promulgated under the SecuritiesAct.

 

 

15

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#### **ITEM 3.          Quantitativeand Qualitative Disclosures About Market Risk**

#### ** **

 

Our investments in marketable securities, which are composed primarilyof investment-grade corporate bonds, U.S. government agency debt securities andmortgage and asset-backed securities, are subject to default, changes in creditrating and changes in market value. These investments are also subject tointerest rate risk and will decrease in value if market interest ratesincrease. As of September 30, 2007, cash, cash equivalents and short-terminvestments were $10.00 million. Due to the nature of these investments, ifmarket interest rates were to increase immediately and uniformly by 10% fromlevels as of September 30, 2007, the decline in fair value would not be material.

 

#### **ITEM 4.          Controlsand Procedures**

#### ** **

 

As of the end of the period covered by this report, based on anevaluation of our disclosure controls and procedures (as defined in Rules13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) eachof the chief executive and chief financial officers of the Company hasconcluded that our disclosure controls and procedures are effective to ensurethat information required to be disclosed by the Company in its Exchange Actreports is recorded, processed, summarized and reported within the applicabletime periods specified by the SEC’s rules and forms.

 

We have not made any changes in our internal controls during the threemonths ended September 30, 2007 that materially affected or are reasonably likelyto materially affect those controls.

 

 

 

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**PART II — OTHER INFORMATION**

 

**Item 1.**               **Legal Proceedings**

 

                           None

 

**Item 1A.**            **Risk Factors**

 

 

 

There were no material changes to the Risk Factors disclosed in theCompany’s Annual Report on Form 10-K for the year ended December 31, 2006.

 

**Item 2.**            **Unregistered Sales of Equity Securities and Use of Proceeds**

 

                           None

 

**Item 3.**            **Defaults Upon Senior Securities**

 

                           None

 

**Item 4.**            **Submission of Matters to a Vote of Security Holders**

 

                           None

 

#### **Item 5.      **     Other Information

####  

                           None.

 

 

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** **

**Item 6.****               ****Exhibits**

 

 

| **Exhibit No.** | ** ** | **Description  of Exhibit**                                                                                                                      | ** ** | **Reference***                                                                                                                    |
|-----------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------------------------------------------------------------------------------------------------------------------|
| ** **      | ** ** | ** **                                                                                                                                       | ** ** | ** **                                                                                                                        |
| 3.1             |       | Restated  Certificate of Incorporation of the Company                                                                                            |       | Exhibit 3.1 to  Registration Statement No. 33-9370, Amendment No. 1 (filed November 26, 1986)                                     |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 3.2             |       | Amendment to Restated  Certificate of Incorporation of Company                                                                                   |       | Exhibit 3.2 to the  Company’s Transitional Report on Form 10-K, File No. 0-15070 (filed March 18,  1991)                     |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 3.3             |       | Amendment to  Restated Certificate of Incorporation of Company                                                                                   |       | Exhibit 3.3 to  the Company’s Form 10-KSB, File No. 0-15070 (filed April 2, 2001)                                            |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 3.4             |       | Amended and Restated  Bylaws of Company                                                                                                          |       | Exhibit 3.4 to the  Company’s Quarterly Report on Form 10Q for the quarter ended September 30,  2006 (filed August 14, 2006) |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.1             |       | Form of Stock  Certificate                                                                                                                       |       | Exhibit 4.1 to  Registration Statement No. 33-9370, Amendment No. 1 (filed November 26, 1986)                                     |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.2             |       | Rights Agreement, dated  as of April 29, 1994, between the Company and American Stock Transfer &  Trust Company, as Rights Agent             |       | Exhibit 1 to the  Company’s Current Report on Form 8-K, File   No. 0-15070 (filed May 2, 1994)                               |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.3             |       | Amendment No. 1 to  Rights Agreement, dated March 4, 2004, between the Company and American Stock  Transfer & Trust Company, as Rights Agent |       | Exhibit 4.3 to the  Company’s Annual Report on Form 10-KSB, File No. 1-15070 (filed March 31,  2006)                         |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.4             |       | Warrant Agreement,  dated March 12, 1997                                                                                                         |       | Exhibit 4.3 to the  Company’s Annual Report on Form 10-K,   File No. 0-15070 (filed March 31, 1997)                          |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.5             |       | Warrant Agreement,  dated January 23, 2004                                                                                                       |       | Exhibit 4 to the  Company’s Registration Statement on Form SB-2, File No. 333-113417 (filed  March 9, 2004)                  |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.6             |       | Form of Warrant  Agreement                                                                                                                       |       | Exhibit 4.1 to the  Company’s Current Report on Form 8-K   (filed on January 6, 2005)                                        |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.7             |       | Warrant Agreement,  dated December 31, 2004                                                                                                      |       | Exhibit 4.2 to the  Company’s Current Report on Form 8-K   (filed on January 6, 2005)                                        |
|            |       |                                                                                                                                             |       |                                                                                                                              |
| 4.8             |       | Form of Warrant                                                                                                                                  |       | Exhibit 4.1 to the  Company’s Current Report on Form 8-K (filed March 7, 2006)                                               |

 

 

18

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| 4.9    |   | Form of Warrant                                                                                    |   | Exhibit 4.1 to the  Company’s Current Report on Form 8-K  (filed December 18, 2006)                                           |
|--------|--------|----------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                               |   |                                                                                                                               |
| 10.1   |   | Patent License  Agreement — Exclusive, between the U.S. Public Health Service and the Company |   | Exhibit 10.1 to the  Company’s Form 10-KSB,   File No. 0-15070 (filed April 2, 2001)**                                        |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.2   |   | Amended and Restated  Directors Stock Option Plan                                                  |   | Exhibit 10.25 to the  Company’s Annual Report on Form 10-K, File No. 0-15070 (filed March 26, 1993)                           |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.3   |   | Amended and Restated  2000 Stock Option and Incentive Plan                                         |   | Exhibit 10.3 to the  Company’s Quarterly Report on Form 10Q for the quarter ended September 30,  2006 (filed August 14, 2006) |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.4   |   | Unit Purchase Agreement  dated March 12, 1997                                                      |   | Exhibit 10.25 to the  Company’s Annual Report on Form 10-K,   File No. 0-15070 (filed March 31, 1997)                         |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.5   |   | Registration Rights  Agreement, dated  March 12, 1997                                              |   | Exhibit 10.26 to the  Company’s Annual Report of Form 10-K,   File No. 0-15070 (filed March 31, 1997)                         |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.6   |   | Lease Agreement dated  April 5, 2002 between the Company and HQ Global Workplaces, Inc.            |   | Exhibit 10.7 to the  Company’s Annual Report on Form 10-KSB,   File No. 0-15070 (filed March 31, 2003)                        |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.7   |   | Employment Agreement                                                                               |   | Exhibit 10.8 to the  Company’s Registration Statement on Form SB-2, File No. 333-113417 (filed  March 9, 2004)                |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.8   |   | Employment Agreement                                                                               |   | Exhibit 10.9 to the  Company’s Registration Statement on Form SB-2, File No. 333-113417 (filed  March 9, 2004)                |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.9   |   | Employment Agreement                                                                               |   | Exhibit 10.9, filed to  the Company’s Quarterly Report on Form 10Q for the quarter ended March 31,  2007 (filed May 15, 2007) |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.10  |   | License Agreement                                                                                  |   | Exhibit 10.10 to the  Company’s Registration Statement on Form  SB-2, File No. 333-113417 (filed March 9, 2004) **            |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.11  |   | Securities Purchase  Agreement                                                                     |   | Exhibit 10.11 to the  Company’s Registration Statement on Form  SB-2, File No. 333-113417 (filed March 9, 2004)               |
|   |   |                                                                                               |   |                                                                                                                               |
| 10.12  |   | Form of Securities  Purchase Agreement                                                             |   | Exhibit 99.1 to the  Company’s Current Report on Form 8-K   (filed on January 6, 2006)                                        |

 

 

19

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| 10.13           |   | Form of Securities  Purchase Agreement                                                              |   | Exhibit 10.1 to the  Company’s Current Report on Form 8-K   (filed on March 7, 2006)  |
|-----------------|--------|-----------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------|
|            |   |                                                                                                |   |                                                                                       |
| 10.14           |   | Form of Securities  Purchase Agreement                                                              |   | Exhibit 10.1 to the  Company’s Current Report on Form 8-K   (filed December 18, 2006) |
|            |   |                                                                                                |   |                                                                                       |
| 10.15           |   | Form of Registration  Rights Agreement                                                              |   | Exhibit 10.2 to the  Company’s Current Report on Form 8-K   (filed December 18, 2006) |
|            |   |                                                                                                |   |                                                                                       |
| 31.1 & 31.2 |   | Certifications pursuant  to Section 302 of the Sarbanes-Oxley Act of 2002 dated  November 14, 2007  |   | Filed herewith                                                                             |
|            |   |                                                                                                |   |                                                                                       |
| 32.1 & 32.2 |   | Certifications pursuant  to Section 906 of the Sarbanes-Oxley Act of 2002 dated   November 14, 2007 |   | Filed herewith                                                                             |
|            |   |                                                                                                |   |                                                                                       |

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*      Except where noted, the exhibits referredto in this column have heretofore been filed with the Securities and ExchangeCommission as exhibits to the documents indicated and are hereby incorporatedby reference thereto. The Registration Statements referred to are RegistrationStatements of the Company.

 

**   Portions of this document have been omittedpursuant to a request for confidential treatment

 

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**SIGNATURES**

 

 

In accordance with therequirements of the Exchange Act, the registrant caused this report to besigned on its behalf by the undersigned, thereunto duly authorized.

 
|   |                              |
|--------|-----------------------------------|
|   | RegeneRx Biopharmaceuticals, Inc. |
|   | (Registrant)                      |

 

 

 

 

 
| Date: November 14, 2007 | /s/J.J. Finkelstein                    |
|-------------------------|----------------------------------------|
|                    | J.J. Finkelstein                       |
|                    | President and Chief  Executive Officer |

 

 

 

 

 
|   |  /s/C. Neil Lyons              |
|--------|-------------------------------------|
|   | C. Neil Lyons                       |
|   | Chief Financial Officer             |
|   | (Principal Financial and Accounting |
|   | Officer)                            |

 

 

 

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